The oil field services companies in the United States are preparing to profits with cloud forecasts

Written by Valery Srivastava

(Reuters)-Next week the results are likely to provide a peek on how to move the three best companies for oil field services in the world in the uncertainty that the American customs tariffs fed, as well as a modern segment of oil prices.

President Donald Trump promised to increase US oil and gas production, and campaigns on the slogan “Children’s drilling exercises”, but the extensive fees for him have fueled a global trade war and their passion for destroying demand.

Brent crude, who was trading at $ 80.15 a barrel when Trump took office on January 20, is currently hovering at $ 66.65 a barrel, as he recovered from $ 58.40 on April 9.

This has been weighed on upstream spending, especially in the United States, where producers give priority to shareholders ’returns and debt reduction due to production growth.

Analysts warn that the additional weakness in oil prices, especially a continuous decrease less than $ 60 a barrel, and the continued uncertainty associated with customs tariffs can lead to 20 % shrinking in the activity of local oil fields from the current levels.

“In the depression (activity) levels, the E&P spending will be reduced, and the E&P spending is the main driver to order service companies,” said Stephen Jinjo, an analyst at Stifel.

Mooringstar estimates that for every $ 5 in low crude prices, spending in the United States decreases by about 5 %, compared to a decline of 1 % in international markets.

Meanwhile, the American definitions of steel and aluminum imports are preparing to escalate the costs of oil field services companies.

Halliburton and Baker Hughes will start profits for the sector on April 22, with the conclusion of SLB on Friday.

Since January, profit forecast for one share has been revised for the three major oil fields services several times, according to LSEG data.

Annual analysts now expect profits per share of 60 cents for Halliburton for 76 cents in the previous year, 48 cents for Baker Hughes for 43 cents, and 74 cents for SLB for 75 cents in the same quarter of 2024.

In addition to the landmarks, Baker Hughes stated that the number of US oil and gas panels decreased by seven to 583 per week ending April 11 – the largest weekly decrease since June 2023.

Investors will watch the comments of the executives closely for clarity in an environment with a very few vision in the short term.

“The first quarter will matter much less,” said Scott Gropy, Citi Research.

“All eyes really turn to the future to evaluate the place where the oil service markets go from here.”

(Participated in the reports of Valely Srivastava in Bangaluru, and was written by Mrinalika Roy; Edit SRIAJ Kalluvila)